Group Coverage May Not Be Enough
Long Term Disability
You may have a group disability plan through your employer, but is it enough?
A group disability plan provides only a basic level of protection. Group plans typically replace 60% of your salary, subject to a monthly benefit cap – and often this amount does not include bonuses, commissions or incentive compensation you may receive. The combined effects of the cap on monthly benefits and the exclusion of bonuses from coverage can create serious shortfalls in protection.
Additionally, if your employer pays the cost of coverage, your benefits are taxable, which can significantly reduce their value.
Group LTD plans share some additional disadvantages:
- Benefits and coverage amounts are determined for you. These can be changed, or the plan can be canceled altogether.
- Generally they offer a restricted definition of disability – rarely due they provide true own occupation protection.
- Costs are not guaranteed for more than a year or so, so if they rise dramatically, an employer may decide
to drop the plan. - Group payments are offset by payments received from Social Security, Worker’s Comp, or other government programs.
Learn more about your
Long Term Disability insurance options.
Learn more about Long Term Disability insurance
RECENT POSTS
Short Term Medical Plans vs. ACA Insurance Plans
If you don’t have employer-sponsored health insurance, there are other options for health coverage. If you don’t have ...
Your Guide to Short Term Medical Insurance
Medical plans can be confusing – here’s the basics of what you need to know about Short Term ...
Can My Homeowners Insurance Cover My Instrument?
While your homeowners policy may provide some coverage for your instrument, it can fall short in some critical ...